Norway: Seadrill Reports Another Soild Quarter

Seadrill today reports consolidated revenues for the first quarter 2011 of US$1,110 million compared to US$1,169 million for the fourth quarter 2010.

Operating profit for the first quarter was US$430 million, down from US$479 million in the fourth quarter 2010, which included US$26 million in gain on sale of the jack-up rig West Larissa. The results for the first quarter were also impacted by lower contribution from Floaters, Tender Rigs and Well Services, following the deconsolidation of Archer/Seawell.

Operating profit from the Floaters was US$312 million as compared to an operating profit of US$322 million in the fourth quarter 2010.

Operating profit from the Jack-up Rigs amounted to US$64 million as compared to an operating profit of US$40 million in the fourth quarter, adjusted for the US$26 million gain on sale of West Larissa in the same quarter 2010.

Operating profit from the Tender Rigs was US$49 million, down from US$75 million in the fourth quarter 2010. The decrease was due to certain non-recurring revenues being recorded in the fourth quarter and the West Menang being idle in the first quarter.

Operating profit from Well Services was US$5 million, down from US$18 million in the preceding quarter, as Well Services was deconsolidated from the Seadrill accounts in February.

Net financial items for the first quarter amounted to a gain of US$441 million as compared to a loss of US$176 million in the previous quarter. The improvement is mainly related to a gain of US$477 million recognized in connection with the deconsolidation of Well Services that triggered an adjustment of the book value of our holding to reflect the market value of the underlying shares.

Income before income taxes amounted to US$871 million, while income taxes were US$48 million.

Net income for the quarter amounted to US$823 million and earnings per share were US$1.84 for the first quarter.

Chief Executive Officer in Seadrill Management AS Alf C Thorkildsen says in a comment, “We are pleased to report another solid quarter for Seadrill reflecting a strong underlying operational performance. Furthermore, over the last three months Seadrill has secured new contracts for approximately US$1.2 billion. These contracts demonstrate the continued strength of the market for quality drilling units. In response to our solid operations, strong contract backlog and favorable market outlook, we are pleased to announce a quarterly cash dividend of US$0.75.”

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Source: Seadrill, May 27, 2011;